C V MADAN Vs. CBI

JUDGEMENT

(1.) Proceedings in R.C. No.2/87, C.C. No. 6/99 pending in the Court of Special Judge CBI. The facts of the case in brief are that an FIR No. R C 2/87/CBI/SIU X / NEW Delhi dated 26.05.1987 was registered on the complaint of Shri S.M. Mehra, Regional Manager-I, State Bank of Patiala against the petitioner who worked as Branch Manager in State Bank of Patiala, Janakpuri Branch from May 1985 to Jan 1987 alleging that the petitioner entered into a criminal conspiracy with M/s.Keming Tools Co. Pvt Ltd. and other co-accused persons and committed a fraud of Rs.3.75 crores by disbursing the said amount fraudulently and dishonestly. It has been alleged that in pursuance of the said criminal conspiracy M/s.Keming Tools opened a credit account No.254 with the bank on 11.12.1986 and an amount of Rs.3.75 crores was released by the petitioner in the form of term loan to the said company without any appraisal and sanction of the competent authority. The investigation into the case revealed that the petitioner had committed this fraud along with four other co-accused persons, namely, Sunil Chandra Kant Khatau, H.S.Nageshwaran, Satish Kumar Chopra and Pradyuman Kumar Khanna. After investigation charge sheet was filed on 23.12.1989 against the above mentioned accused persons under Section 120B r/w 420 IPC and Section 5 (2) r/w 5(1)(d) of the Prevention of Corruption Act in the court of Special Judge-CBI, Tis Hazari Courts. The Special Judge passed an order for framing of charges against all the accused persons vide his order dated 7.2.2007.

(2.) The learned counsel for the petitioner has prayed for quashing of the criminal proceedings against him submitting that the entire amount of loan has been repaid to the bank by the accused no.6 M/s Keming Tools Co. Pvt. Ltd. and there being no loss caused to the complainant bank no case was made out against the petitioner and thus the proceedings against the petitioner is an abuse of process of law and so liable to be quashed. It is further submitted that no sanction has been granted by the bank to the prosecuting agency to proceed against the petitioner and hence the prosecution is bad in law. It is further submitted that otherwise also no offence under Section 420 IPC is made out against the petitioner and also the criminal proceedings ought to be dropped against the petitioner since he has not received any pecuniary gain by disbursing the loan amount to accused company.

(3.) On the other hand, the learned counsel for CBI has opposed the quashing of criminal proceedings against the petitioner by submitting that mere payment of the loan amount by the accused company to the bank is not a valid ground for dropping the criminal proceedings against the petitioner as it has been revealed through investigation that the loan amount was disbursed by the petitioner without any sanction from the competent authority in pursuance of criminal conspiracy with the co-accused persons. It has been further submitted that the petitioner was terminated by the bank before the start of criminal proceedings and hence the proceedings do not suffer from any lack of sanction or illegality.